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Indian media may have come of age in 2001

Indian media appears to have come of age. Be it audio-visual or print, each sector saw consolidation with players either bowing out or sprucing up their act by cutting costs and improving product quality to survive in a difficult market where advertising revenue shrank and each programming minute or column centimetre became that much more expensive.

Says Sony Entertainment Television India chief Kunal Dasgupta: "We have had to restructure operations to survive in a difficult market. So, while we made continuous investments, we also had to cut staff strength by 35 to 275 and cut costs by up to 10 per cent".

US major Bridge News shut operations in India and handed out pink slips to employees here. Another international news agency Dow Jones' proposed expansion via a wholly-owned arm was put on hold. Dow's Suman Dubey was unavailable for comments on this issue.

Reuters has also had to scale down its Indian operations but details were unavailable since its chief Mira Macdonalds was out of the country. French news wire AFP's business arm AFX has been pruned and manpower rationalised.

Restructuring was the buzz-word across this industry - in terms of both programming and operational costs. Also, to beat the slump media houses tried to develop alternate revenue sources, be it encrypting channels to make them pay, getting aggressive on distribution or innovative advertising options.

In the most successful instance of cost-saving, Zee Network became the first Indian venture to be allowed uplinking from Indian soil; it is already eyeing Rs 1 billion revenue from subscription after some of its channels went pay.

SET tried its hand at bagging overseas distribution rights for blockbuster films including Lagaan and Mission Kashmir.

Aroon Purie's Aaj Tak, which was in fact launched in January, showed that by accepting small, regional advertisers a channel can begin to make money very early in its lifecycle.

"We launched in January 2001 and hope to break even by March 31 next year, we're already making cash profits since September last," says CEO of TV Today Network G Krishanan.

Those who could not take the pressures of dwindling advertising revenue coupled with increasing costs have decided to either shut shop or postpone new ventures. Prannoy Roy's New Delhi Television has postponed the launch of entertainment channel NDTV World, despite having arranged funding for it. Ditto for Television Eighteen's proposed entertainment channel. Zee has decided to opt out of a sports channel and has postponed another one hoping for better times ahead.

In the print sector, almost every newspaper and magazine has either reduced the number of pages or done away with certain sections to maintain costs. And all this cost-rationalisation across the media industry has not left media professionals untouched.

Whether it be Zee TV or Sony Entertainment Television, Business Standard newspaper or Reuters, each of these organisations have had to reduce manpower in these trying times.

Zee has restructured its entire top management in both, news and entertainment after management consultant A T Kearney suggested a complete organisational overhaul. SET lost two of its top executives earlier this year although Kunal Dasgupta did not comment on this issue.

Also, another trend which was evident in entertainment television was the clear gains Star raked over all other cable and satellite channels.

Even as the one programme which drove Star to success - Kaun Banega Crorepati - is now on the wane, with one show per week now from four at the beginning of the year, the channel has devised a host of other programmes to earn the moolah.

Not for nothing has Ekta Kapoor been voted among the top 10 communicators by Asia Week magazine - her mushy soap operas have helped maintain Star Plus maintain that critical edge even after KBC lost some of its charm.

While revenues were hard to come by, an unsavoury controversy over the television rating process erupted to show that the business is still vulnerable and advertisers need to develop a better mechanism to track the efficacy of advertising in media.

It was alleged that the list of houses, which act as samples for the two TV rating agencies - ORG and AC Nielsen -has been leaked, thus destroying the very purpose of this research.

But the issue has been sorted out partially by making a fresh list and expediting the proposed merger of these two agencies so that there can be a single barometer for evaluating viewerships across channels, be it news and current affairs or entertainment.

So, while 2001 was an year of consolidation for the media industry, the coming year is expected to provide the incumbent benefits. According to forecasts by a research agency Zenith Optimedia Group, India is the only market other than China, which is expected to show marginal growth in advertising in the coming year.

"For India, the picture is even brighter. While the second and third quarters of the year have shown dips in advertising spend growth, signs of plateauing will be seen in the second quarter and recovery expected from the third quarter of 2002," Zenith says.

So, while the year gone by was tough for most in the media industry, the coming one appears to have some good news waiting to be delivered.

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